Will the Bear Market in the Grain Sector Continue?
Comments for Friday, January 22, 2010
Looking Ahead to Today by Reflecting Back at Thursday’s Price Action
GRAINS:
Lower to sharply lower closes yesterday for rough rice, Minneapolis, Kansas City and Chicago wheat along with soybeans, soy meal, soy oil, corn and oats once again. All of the wheat had poor closes again making new recent lows and closes with Minneapolis in a support area needing to hold the 500 (Mar.) area while KC and Chicago bounced off their respective support areas to close lower but at the upper end of the day’s trading ranges. Corn made its lowest low and close since October 8th again with support under 350 basis the March contract. Traditionally the grains have filled around 90% of their gaps and the December corn contract has one at 392 1/2. Rice settled sharply lower again closing below support looking very bearish Oats made its lowest low and close since September continuing its freefall since the 11th. The bean complex closed lower again with beans and oil making their lowest lows and closes since October. Sell Signals for Wheat, Corn, Oats, Rice and the Soybean complex.
METALS:
Lower closes Thursday for silver, gold, platinum and copper again. All of the metals continue to be in up-trends but have been forming potential tops and are near possible sell signals. Next week should tell the story. Copper is still in a uptrend but had a failed bull triangle which means its retracement is probably not over. Gold went below the important 1100 area but bounced back when the dollar sold off from its highs of the day. Silver is now in a support area. Platinum close down following through from reversal type action on Wednesday but still continues to be the strongest of all the metals at this time.
FINANCIALS:
Higher for the notes and bonds while unchanged for the Eurodollars. The Eurodollar continues to be in a long-term uptrend closing unchanged on its contract high while the notes and bonds made new recent highs and closes again.
For a free download of “Top 50 Reasons Why Futures Traders Lose Money,” click: https://www.zaner.com/3.0/ljs50Reasons.asp
See the balance of my morning comments, including the Metals, Softs, Energies and Grains, at my website. For my complete coverage, visit my commentary page at www.markethead.com.
Rick Alexander has been a broker and analyst in the futures business for over thirty years. He is a Vice-President for Sales and Trading at the Zaner Group (www.zaner.com) a Chicago-based futures brokerage firm. If you would like a free booklet explaining the charts mentioned above, email Rick at ralexander@zaner.com.
The information in this Report and the opinions expressed are subject to change without notice. Neither the information nor any opinion expressed constitutes a solicitation by Rick Alexander or the Zaner Group of the purchase or sale of any futures or options. Futures and options trading is speculative in nature and involves risks. Spread trading is not necessarily less risky than outright positions. Futures and options trading is not suitable for all investors.